Business, Legal & Accounting Glossary
When an asset is consumed in order to increase the value of goods or services to the consumer, a value added cost is incurred. The direct materials, direct labour, and installation costs associated with a sale are examples of value added costs. These costs are typically a small portion of a company’s total costs, leaving a significant opportunity to eliminate non-value-added costs, increasing profits or allowing for price reductions.
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This glossary post was last updated: 13th April, 2022 | 0 Views.